The economic recovery finds firmer foundations
Overview:
Russia was severely affected by the global financial crisis and, as a result, economic indicators in 2009 were poor. However, there were concrete signs of recovery in the last couple of months of the year that meant economic outcomes were not quite as bad as had once been feared. GDP growth, industrial output and exports have all registered positive readings in the last couple of months. This means the financial market stabilisation that preceded the real economy turnaround had some fundamental basis although the recovery could yet prove to be shallow and lengthy. The balance of payments situation has stabilised leading to a gradual rise in the level of FX reserves and the value of the ruble against the basket. However, the budget deficit remains large and recent disinflation may prove temporary as growth recovers.